Insight
Mexico’s short-term capacity market insight: Will solar be left in the dark?
Report summary
In the first two capacity market ex-post settlements, prices in the Sistema Interconectado Nacional (SIN) have cleared above the cost of new entry for a gas combustion turbine, suggesting that market conditions are tight. While fundamentally true, gas market conditions appear to be driving this outcome. Further, availabilities are lower moving south from the US border and notably depressed in the Yucatán, a region with known gas constraints as Mexico’s domestic production continues to decline.
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